News & Commentary:

September 2003 Archives

Articles/Commentary

Making the Millennium Challenge Account Work for AfricaLael Brainard and Allison Driscoll Sep 2003
President Bush has been rightly lauded for his visionary initiative to establish a Millennium Challenge Account (MCA) that would increase U.S. resources directed toward the most promising development investments. The administration's proposal to use a set of publicly available, quantitative indicators to direct assistance to those countries with sound policy environments is a good step towards addressing a longstanding political bias in U.S. foreign aid allocations. But the particulars of the chosen methodology yield results that in large part exclude the poorest countries of sub-Saharan Africa from eligibility—a troubling outcome, since sub-Saharan Africa has the highest concentration of extreme poverty of any region in the world. Fortunately, it turns out there is a simple way to maintain the MCA's emphasis on a transparent, publicly accessible, and rigorous methodology rather than political discretion while also expanding eligibility for Africa. Why not grade the performance of African governments against their peers in the region rather than on a global basis? By simply applying the administration's own methodology on a regionally specific basis, the number of sub-Saharan African countries that qualify for the MCA with per capita incomes below $1,435 would triple and the population coverage would double.

Third Annual IMF Research ConferenceIMF Staff Papers, Volume 50, Special issue Sep 2003
The third Annual Research Conference of the International Monetary Fund took place in Washington, DC, on November 7 and 8, 2002. Speakers included scholars from universities and other research institutions as well as young researchers in the Fund. This year's conference discussed capital flows and global governance. The Mundell-Fleming lecture was delivered by Guillermo Calvo, Chief Economist of the Inter-American Development Bank. This year's conference also included a panel discussion with the title "Promoting Better National Institutions: The Role of the IMF." Panelists included: Guillermo Ortiz (Banco de Mexico), Jeffrey Frankel (Harvard University), Nancy Birdsall (Center for Global Development), and Jeffrey Sachs (Columbia University). A Special Issue of the IMF Staff Papers, published in 2003, contains some papers presented at this conference.

Reporters Without Borders publishes the first worldwide press freedom indexReporters Without Borders Sep 1, 2003
The first worldwide index of press freedom has some surprises for Western democracies. The United States ranks below Costa Rica and Italy scores lower than Benin. The five countries with least press freedom are North Korea, China, Burma, Turkmenistan and Bhutan.

France blocks free tradeIHT Sep 2, 2003
French farmers and government officials are fond of saying that the word "culture" is contained within the term "agriculture" for a reason. Farming is a way of life, the French argue, which governments are entitled to protect from the impact of "mindless trade liberalization" in a way that they ought not protect, say, refrigerator manufacturers. The French have a strong attachment to the ideal of the bucolic countryside, and a change in agricultural policy can be blown up into a threat to national identity.

The Emerging Truth of Going GlobalEswar Prasad and Kenneth Rogoff (IMF) Sep 2, 2003
Recent financial crises in the emerging markets have stoked a heated debate about the benefits and costs of financial globalization. Many countries that have participated actively in the process experienced rapid growth for some years. But the subsequent financial crises have been cited as evidence that the deck is stacked against the globalizers.

Global: Do Imbalances Matter?Stephen Roach (MSDW) Sep 2, 2003
As the summer of 2003 winds down, the markets are going through a classic cyclical drill. Around the world, financial assets are being priced for recovery, renewed inflationary pressures, and central bank targeting. It's a scenario we've all been through before, time and again. Yet it's the ultimate comeuppance for those of us who have been tempting fate and maintaining that "this time is different".

Currencies: The Exchange Rate Policies of the 'Big Four'Stephen L Jen (MSDW) Sep 2, 2003
The exchange rate policies in the US, Euroland, Japan, and China have significantly influenced the trajectories and exaggerated the volatility of G3 exchange rates in the past two years. We believe they are likely to continue to distort how natural market pressures translate into exchange rate levels.

China seeks to calm fears over renminbiFT Sep 3, 2003
Senior Chinese officials were set to respond to US concerns over China's ballooning trade surplus by assuring John Snow, US treasury secretary, that Beijing planned to abandon its fixed exchange rate.

Free China, Float the YuanJames A. Dorn (WSJE) Sep 3, 2003
As long as the state controls the flow of capital, the Chinese will be subject to exploitation.

Asia's Emerging Markets: a Growing Force in the World EconomyHorst Köhler (IMF) Sep 4, 2003
I want to talk about the growing presence, and future role, of the Asian emerging market economies in the world economy—and Kuala Lumpur is the perfect place to do so. Here, as elsewhere in the region, outward-looking policies are proving key to a strong economic performance, even in the current difficult international environment.

Declaration by the Heads of the IMF, OECD and World BankIMF/OECD/WB Sep 4, 2003
Next week, trade ministers will gather at Cancún to advance the Doha Development Agenda. They carry with them the aspirations of millions around the world whose hopes for economic advancement rest on opportunities in the global economy. Trade is a driving force for economic expansion in developed and developing countries alike. Promoting the growth of trade is essential for global economic prosperity. And the Doha negotiations are a central pillar of the global strategy to achieve the Millennium Development Goals: a strategy to reduce poverty by giving poor people the opportunity to help themselves.

GC Chair Issues Note To Accompany Draft Ministerial Text As Members Prepare For Cancun MeetingBRIDGES Weekly Trade News Digest - Vol. 7, Number 30 Sep 4, 2003
With only few days to go before ministers meet for the fifth WTO Ministerial from 10-14 September, participants and civil society organisations are already convening in Cancun, Mexico, for a number of workshops, teach-ins, meetings and informal talks between Members. Meanwhile, WTO General Council Chair Carlos Perez del Castillo, with Director-General Supachai Panitchpakdi, issued a cover note to accompany the draft ministerial text at Cancun, highlighting areas where major divides persist between Members. While the process generally has moved from Geneva to Cancun, Members managed to agree on a pre-Cancun solution to poor countries' access to essential medicines in Geneva over the weekend.

Industrial Market Access: North-South Split Persists Leading Into CancunBRIDGES Weekly Trade News Digest - Vol. 7, Number 30 Sep 4, 2003
During informal meetings at the WTO last week, an annex on industrial market access attached to the 24 August draft Ministerial text continued to elicit reactions from dissatisfied countries. While the Chair of the Negotiating Group on Non-agricultural Market Access (NAMA), Pierre-Louis Girard, had submitted a revised modalities paper on 19 August, persistent lack of agreement led him to develop instead a framework for establishing modalities -- without identifying specific numeric tariff liberalisation targets -- for ministers to endorse in Cancun.

S&D 'Early Harvest': The 'Development' Agenda In Action?BRIDGES Weekly Trade News Digest - Vol. 7, Number 30 Sep 4, 2003
While official word was that the Geneva process was over, Chair Pérez del Castillo tried to call an informal Heads of Delegations session on Wednesday, 3 September to discuss the most divisive proposals put on the table by developing countries in the review to strengthen and operationalise special and differential treatment (S&D) provisions. A combination of the fact that most Heads of Delegation have already left Geneva for Cancun, and a sense that little could be done at this late a stage, prompted the cancellation of the meeting. Chair Pérez del Castillo had promised developing countries that he would 'take up' this category of proposals before Cancun. It now seems likely, however, that these will only get addressed post-Cancun, and in the special sessions of the Committee on Trade and Development rather than the General Council.

Strengthening Growth Through Regional and Global Economic CooperationHorst Köhler (IMF) Sep 4, 2003
A world recovery appears to be underway, but it remains tentative and uneven. The primary responsibility for restoring healthy world growth rests with the advanced economies, but all countries can play a part in this effort. I would like now to shift the focus from the short-term policy requirements to steps needed to reinforce the underpinnings for strong growth over the medium term.

David DeRosa (Bloomberg) Sep 7, 2003
There's a Chinese proverb that a closed mind is like a closed book -- just a block of wood. That's how U.S. Treasury Secretary John Snow might be thinking about his Asian ministerial colleagues following this week's meeting in Phuket, Thailand.

EU determined to make trade work for allEU DGT Sep 8, 2003
On 10 September 2003 the World Trade Organisation will open its 5th Ministerial Conference in Cancun. This meeting is an important staging post on the road to a successful conclusion by end 2004 of the Doha Development Agenda (DDA), the round of trade negotiations launched two years ago in Qatar. The DDA is crucial for bolstering international economic growth, and helping developing countries integrate into the global economy. So it is critical that Cancun is a success, and the EU has pushed hard for progress on the outstanding issues.

Global: Traction, Multipliers, and Leakages Stephen Roach (MSDW) Sep 8, 2003
America’s jobless recovery continues unabated. With headcounts falling another 93,000 in August, the case for sustainable recovery in a post-bubble US economy remains a real stretch, in my view. While policy stimulus seems to be working temporarily on the demand side of the equation, there’s been little follow-through on the supply side. This may well reflect profound and lasting leakages in the external environment -- driven by globalization, outsourcing and the Internet -- that have diminished the policy multipliers that normally spark full-blown cyclical recovery. The character of the modern-day US business cycle may now be changing as never before.

Global, Japan: Gnashing and NashRobert Alan Feldman (MSDW) Sep 8, 2003
There has been much gnashing of teeth in Tokyo, Washington and Beijing on the issue of the yen, the dollar, and the RMB. While I hesitate to add to the analysis provided by my colleagues Stephen Jen, Andy Xie, and Stephen Roach, one aspect of the debate bothers me. The treatment of the exchange rate issue has a tendency to bifurcation, i.e., one issue is the RMB/US dollar rate, and the other is the yen/dollar rate. I see the two exchange rate issues as fundamentally linked, however, because of both economics and politics. Indeed, my view is that China, Japan, and the US are now in a sub-optimal Nash equilibrium -- where no one has an incentive to change policy so long as others do not. So no one changes. And the imbalances pile up. Investors are vitally interested in whether this logjam can be broken.

Showdown in CancúnNYT Sep 10, 2003
Few things could improve the lives of more people than a strong commitment from the World Trade Organization to create a fair and efficient global market for agricultural goods.

The Task at CancunWP Sep 10, 2003
As trade negotiators gather for the World Trade Organization's ministerial meeting in Cancun today, it might help if they stopped, took a deep breath and tried to remember just what the current round of trade negotiations, begun two years ago in Doha, Qatar, was meant to achieve. At the heart of the Doha declaration lay a new commitment to the world's poor. According to its text, "international trade can play a major role in the promotion of economic development and the alleviation of poverty."

The Cancun trade talksEconomist Sep 10, 2003
The Doha round of trade talks reaches its halfway point at Cancun this week. Some World Trade Organisation members are just getting started; others already look exhausted

Argentina and the IMFEconomist Sep 10, 2003
Argentina has failed to pay back part of a giant IMF loan, endangering the lender's reputation as much as the borrower's

Does External Tide Raise All Boats in Southeast Asia?Daniel Lian (MSDW) Sep 10, 2003
Favorable external factors are propping up Southeast Asia markets as analysts rush to upgrade growth forecasts for the region. In some sense, the countries of Southeast Asia are being viewed as generic undervalued markets by global investors. In this note, the issue of whether the favorable external tide will necessarily raise all boats in Southeast Asia by the same magnitude is explored. I present the favorable external economic factors that are “almost” common to all five economies, and explore three indigenous economic factors – domestic demand policies, asset reflation expectations of households and firms, and risk premiums linked to geopolitics and domestic security risks – that would potentially differentiate performance in these five economies and markets.

New global banks' rules delayedFT Sep 11, 2003
Attempts to make the international financial system more stable suffered a setback when the European Central Bank admitted the plans by regulators could be delayed by a year.

Address at the Fifth WTO Ministerial ConferenceAddress at the Fifth WTO Ministerial Conference Sep 11, 2003
I'm delighted to be here in Cancún and, on behalf of the International Monetary Fund, to offer support for the negotiations over the coming days. A successful conclusion to the Doha round is vital if we are to maintain the momentum established by earlier trade rounds. It would provide a boost for the world economy as a whole. The IMF is determined to do all it can to help make the round a success. I hope today to explain how we at the Fund might make a practical contribution to help ensure that success.

Argentina and the IMFEconomist Sep 11, 2003
Argentina defaulted on a payment of $2.9 billion to the IMF, the largest sovereign debt default in history. The next day, however, it reached a deal with the Fund to refinance $21 billion-worth of debt with multilateral lenders, including $12.3 billion with the IMF. The deal also included a 3% budget-surplus target for 2004, lower and kinder than expected.

The Mexican marathon beginsEconomist Sep 11, 2003
A meeting of the World Trade Organisation began in Cancún, Mexico. As usual, a rag-bag of anti-globalisation protesters attempted to disrupt proceedings and one Korean protester even committed suicide. High on the agenda: repairing the rift between rich and poor countries over farm subsidies.

The Cancún trade talksEconomist Sep 12, 2003
The G22, a coalition of poor countries led by the likes of India and Brazil, is talking tough at the world trade talks in Cancún. But its calls for America and the European Union to slash their agricultural subsidies with little in return are unlikely to be heeded.

A Preview of the World Bank/IMF and World Trade Organization MeetingsBrookings Sep 9, 2003
The next few weeks have two of the most important sort of pow-wows of international economic ministers that we see all year. There are a lot of very weighty topics on the table for discussion, although I don't actually expect a lot of very concrete outcomes to come out of either meeting. Let me just give you a little sense of where the U.S. is likely to be on several of the kind of high-profile issues, and just touch on them briefly and we can come back to them, if you're interested, later in the questions.

Cancún Targets CottonNYT Sep 13, 2003
The U.S. would go a long way toward reclaiming its moral leadership on trade matters if it reached a deal on cotton with the Africans while still at the World Trade Organization's meeting.

Is Japan Backing Off on Weakening the Yen?David DeRosa (Bloomberg) Sep 14, 2003
Haruhiko Kuroda, senior adviser to Japanese Prime Minister Junichiro Koizumi, knocked foreign- exchange traders off their chairs when he said last week that sales or purchases of currency by a government to influence exchange rates should be an ``unusual'' policy tool.

WTO Trade Talks CollapseST Sep 15, 2003
A crucial WTO ministerial conference to spur momentum towards a new global trade pact collapsed in failure on Sunday, a setback that could jeopardise the future of the multilateral trading system.

Sea Change in CancunAWSJ Sep 15, 2003
The addition of Beijing's voice to the WTO forum can help make sure that the world's poor get a fair shake in the councils of power deciding the world's trading system.

Don't Let NGOs Distract the WTOAlan Oxley (AWSJ) Sep 15, 2003
Let's hope that trade ministers in Cancun don't lose sight of the big picture due to pressure from Western nongovernmental organizations playing politics with trade.

World trade Economist Sep 15, 2003
The world trade summit in Cancún, Mexico, has collapsed without agreement. Its fate may have been sealed seven years ago in Singapore.

Global: Another New ParadigmStephen Roach (MSDW) Sep 15, 2003
As the US economy now shifts gears, hopes of a full-blown global upturn are in the air. Our economists in the US and Japan have raised their sights as the incoming data flow has moved to the upside. So far, they are largely alone in reworking their numbers, but there are hopes that revival may spread elsewhere around the world. This raises a key question as to the character of any potential upturn in the global business cycle: Can the world break the mold of the US-centric growth dynamic that has been in place over the past seven years? The answer could well be decisive in determining the sustainability of any recovery in the global economy.

Review of A Perilous Progress: Economists and Public Purpose in Twentieth-Century America, By Michael A. BernsteinRobert H. Nelson (Independent Review, Volume 8, Number 2) Sep 2003
In A Perilous Progress, Michael Bernstein reminds us of the importance of the Progressive era in setting the stage for the twentieth-century history of government in the United States. Progressive intellectuals preached the scientific management of American society, as orchestrated by the federal government. The federal managers of society would be part of a new “meritocratic order—a network of new social relationships premised on educational achievement, professional accomplishment, and adherence to ethical codes of conduct” (p. 12). Professional groups, such as economists, would be the vital repositories for expert knowledge and would provide the specialist personnel to guide the modern state. As Bernstein comments, the “American century” was “first and foremost, an era of professional accomplishment and perquisites” (p. 13).

Crushed at CancúnFT Sep 16, 2003
The unexpected breakdown in the Doha round leaves a divided WTO facing marginalisation as countries turn to bilateral deals. The poor are likely to be the biggest losers. 21:59 | Read

Singapore likely to back regional common marketFT Sep 16, 2003
Goh Chok Tong, Singapore's prime minister, said south-east Asian nations were likely to endorse plans for a regional common market next month to counter competition from China and India.

The Cancún FailureNYT Sep 16, 2003
At a World Trade Organization meeting last week, rich nations derailed the talks rather than tackling the problem of their high agricultural tariffs.

Cancun CollapseWP Sep 16, 2003
"Bold reform on the global level has now been delayed." That was how a senior U.S. trade official bluntly described the consequences of the collapse of the Cancun trade talks last weekend. It may well be an understatement. Although negotiations will continue, no one expects the World Trade Organization's Doha round of trade negotiations to be completed on schedule, by the end of next year. At the moment all participants are indulging in an orgy of finger-pointing and name-calling. In truth, everyone involved bears a part of the responsibility for the collapse of the talks -- rich countries, poor countries and middle-income countries alike.

Why we all need the United NationsJonathan Power (IHT) Sep 17, 2003
If Europe and the rest of the world want to save the United Nations as an institution that counts - and Iraq from the disintegration that confronts it - they must let the United States back into the UN - and into the driver's seat. As the late Dag Hammarskjöld, the United Nation's most revered secretary general, once said, "The UN was created not to get us to heaven but to save us from hell."

Prodi plans reforms for enlarged EUFT Sep 17, 2003
Romano Prodi, president of the European Commission, will today outline plans for far-reaching reforms to the EU executive, to stop it seizing up when the Union expands

World Trade: The Fine Art Of FailureFEER Sep 18, 2003
Even as global trade talks collapsed in a heap of acrimony, Beijing managed to gain praise both for its activism and restraint. How did that happen?

The Cancún circus: A worn-out act by rich nationsJohn Audley (IHT) Sep 18, 2003
The World Trade Organization talks here last week looked more like a three-ring circus than the top-level negotiations they were billed as. Unsurprisingly, negotiators went home unsuccessful. Who expects to secure a deal under the big top?

A big future for commoditiesFT Sep 18, 2003
Prices of raw materials are rising strongly. Some investors see a speculative bubble, others a long-term trend that reflects underlying changes in portfolio allocations.

Bad Advice on the YuanBill Belchere (AWSJ) Sep 18, 2003
A knee-jerk strengthening of the currency is the last thing China needs.

US to China: Make Goods More Expensive!Jude Blanchette (Mises Daily) Sep 18, 2003
There is, it seems, a segment of the American population that firmly believes China to be the greatest economic threat facing our country. As if domestic taxation, regulation and deficit spending were of negligible effect upon America's economic well being, dealing with the threat from the Far East now ranks as our nation's #1 priority. This animus towards the Chinese has taken form in a number of disagreements between the respective country's governments in addition to a well-organized campaign to convince the public that China's increasing dominance threatens America's prosperity.

Collapse in CancúnEconomist Sep 18, 2003
A meeting of the World Trade Organisation in Cancún, Mexico, broke up amid acrimony. Representatives of the world's poorest nations blamed rich countries for making too few concessions on agricultural subsidies and for insisting on new rules on investment.

A European assault on AmericaEconomist Sep 18, 2003
Eurex, a German-Swiss derivatives exchange, unveiled plans to set up a new, all-electronic market in Chicago next year. It will be the first foreign exchange in America and a direct challenge to the Chicago Mercantile Exchange and the Chicago Board of Trade.

Cancun: The Real Losers are the PoorSupachai Panitchpakdi (WTO) Sep 18, 2003
Director-General Supachai Panitchpakdi, in the International Herald Tribune edition of 18 September 2003, wrote that the future of trade issues of potential benefit to developing countries such as market-opening in manufactured products, services and agriculture, are uncertain because of lack of agreement at Cancún. He added that he would immediately look for ways to move the WTO process forward.

Asian currency manipulation comes under fireFT Sep 19, 2003
Asian intervention to hold currencies down is helping to push the world economic recovery off balance and risks creating instability in coming years, says the IMF.

The Safety of Imported DrugsNYT Sep 20, 2003
Encouraging prescription drug imports might provide a useful nudge to the industry to revise its global pricing policies to spread the burden more fairly.

Rethinking the U.N.WP Sep 21, 2003
At a time when the Bush administration appears to be slowly, painfully and not entirely successfully returning to the idea that the United Nations has a role to play in Iraq, it is worth listening hard to the U.N. secretary general, Kofi Annan, who has just presented a paper calling for "radical reform" of the U.N. system. On the one hand, he said -- using unusually frank language for a secretary general -- "repetitive and sterile debates crowd out the items that really matter" in the General Assembly, where all 191 member countries are represented. In the Security Council, by contrast, Mr. Annan believes that "the problem is rather the opposite." Because of its small numbers -- five permanent members and 10 elected members -- the body "lacks legitimacy in the eyes of the developing world." In separate comments, Mr. Annan has hinted at his solution: Let more veto-wielding nations onto the Security Council, possibly including one from the Middle East.

Asia's awakeningFT Sep 22, 2003
The region's rise as a manufacturing powerhouse and accumulator of foreign exchange reserves presents both opportunities and dangers for the global financial and trading system. 21:21 | Read

Global: BreakthroughStephen Roach (MSDW) Sep 22, 2003
An unbalanced global economy has finally come to its senses. At the just-concluded G-7 meetings in Dubai, the world’s major industrial economies have endorsed the basic premise of global rebalancing -- a long overdue adjustment in the dollar. This could well have profound and lasting implications for the world economy. It is an unequivocally positive development, in my view.

Global: What Are the Options?Rebecca McCaughrin (MSDW) Sep 22, 2003
Political pressure on Asian governments to revise their currency regime and sharp declines in the price of US government debt have fueled concerns that if central banks were to diversify their holdings, US interest rates would rise, raising the specter of even greater volatility in Treasury bond yields. This, it is argued, could derail the economic recovery, as higher interest rates could in turn slow consumer and business spending. In our view, these concerns are highly exaggerated, and, in fact, misplaced.

Asia Pacific: Currency Intervention Likely to ResumeAndy Xie (MSDW) Sep 23, 2003
The G-7 communiqué over the weekend was not another Plaza Accord. In my view, it was more the outcome of a group of the world’s wealthiest nations trying to beat down a large, fast-growing but still poor China without China being present. A new world order is only likely to work with China’s consent.

EU ministers vow to defend trade systemFT Sep 23, 2003
European Union farm ministers vowed to defend the multilateral trade system in the wake of the breakdown of WTO talks on a new global trade agreement last week.

China's pivotal position for the world economyPhilip Bowring (IHT) Sep 24, 2003
China has long hankered after a role in international affairs commensurate with its size. But suddenly it finds itself with an embarrassment of influence. It holds a critically important position on the two most crucial economic issues now facing the world: the future of the World Trade Organization after the debacle at Cancún, and the role of Asian currency valuations in avoiding a trade war.

Storing up troubleFT Sep 24, 2003
Asia's policy of accumulating foreign exchange reserves is inefficient and adds to the instability in the global economy. But it is evidence of the caution still felt in the region

New Word OrderClaudia Rosett (WSJ) Sep 24, 2003
It's time to revamp the language of diplomacy and war.

Wrangling Over Exchange ratesEconomist Sep 24, 2003
The G7 says that markets should set exchange rates. But one of the seven—Japan—thinks they need a little help.

Trade: The One-Two PunchFEER Sep 25, 2003
China is coming under fire in the United States on two fronts. Politicians and others accuse Beijing of stealing U.S. jobs. But growing anger at the slow pace of trade reforms may prove the bigger issue

An interlinked economyFT Sep 25, 2003
Intra-regional trade in east Asia is rising rapidly. In contrast to the EU or North America, companies and investors, rather than governments, are the driving force.

Opec cuts output to keep oil prices above $25FT Sep 25, 2003
The Opec oil cartel slashed 900,000 barrels a day from its production ceiling, signalling a new emphasis on reducing the inventories of the biggest consuming countries to keep prices above $25 a barrel.

WTO: Uncertainty Dominates As Members Return To Geneva ProcessBRIDGES Weekly Trade News Digest - Vol. 7, Number 31 Sep 25, 2003
In contrast to the last frantic hours in Cancun, Mexico, following the collapse of trade talks on 14 September -- during which WTO Members, as well as civil society and other groups, scrambled to issue statements and hold press briefings -- the journey back to Geneva has been quiet and gradual. Ministers have returned to their capitals, and trade diplomats in Geneva will be tasked with finding a way forward in anticipation of a General Council (GC) meeting at the high-officials level by 15 December. For the time being, the WTO stands practically empty, with a number of staff on vacation and the next "negotiating" meeting, a Committee on Agriculture Special Session, scheduled for 6-9 October, closely followed by negotiating sessions on rules and services. These meetings, if held as planned, may give an indication of where Members stand on certain issues, although little movement is expected before the December GC meeting -- if then.

Is `Irrational Exuberance' Coming to Asia?William Pesek Jr. (Bloomberg) Sep 25, 2003
Roger Ferguson, the No. 2 official at the U.S. Federal Reserve, raised eyebrows this week by saying financial market valuations may be ``overly optimistic'' about how sustainable the global economic recovery is.

A-a-and down!Economist Sep 25, 2003
The dollar fell to a three-year low against the yen and recent gains against the euro were reversed after the G7 group of rich countries called for “more flexibility” in exchange rates. John Snow, America's treasury secretary, first called the G7 statement “a milestone change” but later sowed confusion by saying that America's “strong dollar policy” still stood.

The terrorists won at CancúnThomas L. Friedman (IHT) Sep 26, 2003
The U.S. war on terrorism suffered a huge blow last week - not in Baghdad or Kabul, but on the beaches of Cancún.

'Western style management with an eastern touch'FT Sep 26, 2003
Many of Asia's corporate leaders have rebounded after the 1997 financial crisis and are prospering globally. To what extent has their success been achieved by abandoning an 'Asian model'?

End the Steel TariffsWP Sep 26, 2003
No one would ever accuse the Bush administration of being eager to admit to its mistakes. But in the case of steel tariffs imposed by the president in 2002, such an admission is overdue. The tariffs were a diplomatic failure: Imposed just as a critical round of international trade negotiations was getting underway, they sent precisely the wrong message to the world at precisely the wrong time -- namely, that the United States supports free trade in theory but not in practice. The World Trade Organization has condemned the tariffs and, depending on the results of an appeal, may well allow others to retaliate against the United States.

The IMF, WTO and World BankEconomist Sep 26, 2003
Poor countries want a greater say in the running of world economic institutions. Some think they have said quite enough

Does World Trade Need World Government?Llewellyn H. Rockwell, Jr. (Mises Blog) Sep 27, 2003
This much we know: prosperous nations have the fewest barriers to trade, while poor nations have the most. That fact alone does not prove the case for free trade, but adding a bit of logic sews up the case. The wider the pool from which a country can draw labor and capital, the more likely it is that resources will be used efficiently and to the betterment of all. By opening up an economy beyond the borders of the nation-state, the workers and capital resources of a country find the best possible employments toward the goal of serving society as a whole.

Time for a Trade 'Hegemon'Bernard K. Gordon (WSJ) Sep 29, 2003
Failed talks in Cancun could signal the fall of beneficial trade agreements.

China rethinks "go-for-growth" strategyFT Sep 30, 2003
China is evolving a new philosophy on economic development, to shift the emphasis from its "go-for-growth" policies of the past two decades to a more sustainable model.